Snapshots:
Under cross-examination by defence counsel Michael O’Higgins SC, for Seán FitzPatrick, Mr Moran said that when he contacted the investment bank Morgan Stanley about the unwinding of businessman Seán Quinn’s contract for difference positions, it was his understanding that the financial regulator “was supportive of having the Quinn position reduced”. He agreed that after St Patrick’s Day 2008, when Anglo’s share price fell
by 20 per cent in a day, the regulator became “more fulsomely” involved with the bank.

The court previously heard that before the so-called Maple 10 transaction, Anglo discussed another plan to unwind Mr Quinn’s CFD positions. This plan would have involved placing about 10 per cent of Anglo’s shares with institutional investors. However, at a conference in London on April 1st, 2008, Mr Moran said, he was advised by a number of senior staff at Morgan Stanley that it was not the right time to go to the market.

That proposed transaction involving institutional investors did not go ahead. In a note prepared by Mr Moran after the events in question – parts of which were read out in court yesterday – he recalled the “huge disappointment” expressed by Con Horan, prudential director at the regulator’s office, on learning this plan would not proceed.

In March 2008, an agreement had been drawn up between Anglo and Mr Quinn’s side to deal with the CFD issue. The first draft of that agreement included a reference to approval from the regulator, but it was later amended so that the reference to the regulator was removed. Mr Moran said Con Horan, prudential director at the regulator’s office, had asked that this line be removed.

Mr O’Higgins suggested there was an element of “plausible deniability” about the regulator’s approach. “Is there a touch of ‘Yes, Minister’ going on here?” counsel asked. “I think it’s difficult for me to comment on that remark,” Mr Moran replied. Mr O’Higgins asked Mr Moran if he had heard of the term plausible deniability, which he defined as “being involved in something, controlling it, but not appearing above the waterline line so if any questions were asked later it could be said in a plausible way you were not involved.” “Am I right in suggesting that’s the flavour of what’s happening here?” counsel said. “That does appear to be the case,” Mr Moran responded.

Mr O’Higgins asked who Mr Moran believed Matheson Ormsby Prentice solicitor Robert Heron was acting for during the Anglo-Quinn deal. Mr Moran responded that Mr Heron was to “sit in the middle” between the Quinn Group and the bank. Mr O’Higgins asked if Mr Moran had ever known circumstances where “two significant entities” shared a solicitor. “Ever done business like that before?” he asked. “No, I haven’t,” Mr Moran responded.

A
round April 1st, 2008, a meeting took place between Liam McCaffrey of the Quinn Group and Anglo chief executive David Drumm. Mr Moran, who was also there, said Mr McCaffrey suggested Seán Quinn would “go long” and buy share stock in the bank before unwinding his CFDs in Anglo. But Mr Drumm vetoed that. Mr Moran said Mr Drumm thought it would be “improper” and the regulator would not approve. So at the first instance of something suspect, “Mr Drumm put his foot down and said no”, Mr O’Higgins suggested. Mr Moran agreed.